The mining industry is about to fall into a very deep hole

But there could be light at the end of the tunnel.

The mining industry finds itself in a very deep hole after new data from China.

China’s May figures show a dawdling second quarter in the world’s second largest economy. The effect was imminent on the Indian Rupee and the Australian dollar, but the biggest blow was delivered at mining companies, which fell 0.7 per cent. Commodity prices crippled from Australia to South Africa and Standard & Poor’s GSCI gauge of 24 raw materials dropped 0.5 per cent.

This whirlwind of data has sent tremors through mining companies everywhere, from board room to base camp. But why should this matter here in Britain, where mining is something more nostalgic than material?

The irony is that as Britain has lost all its mines, it has gained more mining companies. London has become the commodity centre of the world through the London Metal Exchange and, as a result, has some of the world’s largest mining companies: Anglo American, Glencore Xstrata and Rio Tinto are all listed here.

Aside from China’s depressing figures, it has not been a good spring for London’s listed miners. ENRC, the London listed Kazakh mining group is under investigation by the Serious Fraud Office for multiple counts of corruption while Bumi, already a boardroom battle ground, announced last week that it has “lost” $201m. Following these allegations, there are calls for the FSA to keep a closer eye on these UK-listed mining companies – that means more regulation.

But perhaps it is not all doom and gloom for London miners. Like with the banking industry, forced competition on the one hand and tighter regulation on the other might see a turnaround in an industry mired in controversy.

Photograph: Getty Images

Oliver Williams is an analyst at WealthInsight and writes for VRL Financial News

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.